Exhibit 10.1
PROMISSORY NOTE PURCHASE AGREEMENT
This Promissory Note Purchase
Agreement dated as of April 15, 2005 (the “
Agreement ”) by and between John J. Moores (“
Purchaser ”), NEON Systems, Inc., a Delaware
corporation (“ Seller ”) and Neon Enterprise
Software, Inc., a Delaware corporation formerly known as
Peregrine/Bridge Transfer Corporation (the
“Company”):
WITNESSETH:
WHEREAS, Seller owns the convertible
promissory note dated August 14, 2002 made by the Company,
payable to the order of Seller with a principal amount of
$3,000,000 (the “ Convertible Note
”);
WHEREAS, Seller also owns the
non-convertible promissory note dated August 14, 2002 made by
the Company and payable to the order of Seller with a principal
amount of $3,584,028 (the “ Non-Convertible Note
”), which Non-Convertible Note together with the Convertible
Note are hereinafter referred to as the
“Notes”;
WHEREAS, the Company’s
obligations under the Notes are secured by the security interests
granted pursuant to the Security Agreement dated effective as of
August 14, 2002 by and between the Company and Seller (the
“ Security Agreement ”);
WHEREAS, the Notes have matured and
the Company is in default under the Notes; and
WHEREAS, Seller desires to sell to
Purchaser, and Purchaser desires to purchase from Seller, all of
Seller’s right, title and interest in and to the Notes, the
Security Agreement and all related agreements and instruments on
the terms and subject to the conditions set forth in this
Agreement;
NOW, THEREFORE, in consideration of
these premises and the representations, warranties and covenants
set forth in this Agreement, the parties agree as
follows:
1.
Purchase of Assets
. On the terms and conditions
set forth in this Agreement, at the Closing (as defined below),
Seller shall GRANT, BARGAIN, CONVEY, SELL, ASSIGN, TRANSFER AND
DELIVER to Purchaser, and Purchaser shall purchase, accept and
assume from Seller, all of Seller’s right, title and interest
in and to the following (collectively, the “ Purchased
Assets ”):
(a)
the Notes and the indebtedness of
the Company payable thereunder;
(b)
all rights, titles, interests,
liens, securing interests, privileges, claims, demands and equities
now existing or hereafter arising under or out of the agreements
and instruments listed on Schedule I to this Agreement
(the “ Assumed Contracts ”); and
(c)
all rights, claims, credits, causes
of action or rights of set-off of Seller against third parties
relating to the Notes and the Assumed Contracts, including those
relating to any breaches or defaults by the Company prior to the
Closing,
TO HAVE AND TO HOLD the Purchased Assets unto
the Purchaser, for the benefit of his successors and assigns,
forever; provided, however, the Purchaser does not assume and shall
not be obligated to pay, perform or discharge any claim, debt,
obligation, expense or liability of the Seller of any kind, whether
known or unknown, absolute or contingent, under the Notes, Assumed
Contracts or otherwise, arising out of any act or omission
occurring on or before the Closing Date.
2.
Assumption of
Liabilities . As
partial consideration for the sale, transfer, assignment and
delivery of the Purchased Assets and on the terms and subject to
the conditions set forth in this Agreement, Purchaser shall assume
and
perform the liabilities and obligations of
Seller under the Notes and the Assumed Contracts (collectively, the
“ Assumed Liabilities ”) arising from and after
the Closing and no others.
3.
Purchase Price
. On the terms and subject to
the conditions set forth in this Agreement, in reliance on the
representations, warranties and agreements of Seller set forth in
this Agreement, and in consideration of the sale, transfer,
assignment and delivery by Seller of the Purchased Assets, at the
Closing Buyer shall (i) assume the Assumed Liabilities,
(ii) pay to Seller an amount in cash equal to $4,350,000 (the
“ Cash Purchase Price ”), and (iii) execute a
promissory note between Purchaser and Seller in the principal
amount of $2,234,028 in the form attached hereto as Exhibit
B (the “ Purchase Note ”).
4.
Closing . (a) The closing (the “
Closing ”) shall take place at the office of Seller at
10:00 a.m., Sugar Land, Texas time, on April 15, 2005, or
at such other date, time and place as may be agreed upon between
Purchaser and Seller (the date on which the Closing occurs, the
“ Closing Date ”).
(b)
At the Closing, Seller shall
(i) deliver to Purchaser the Notes, duly endorsed (or
accompanied by an instrument duly endorsed) in blank for transfer
and (ii) execute and deliver to Purchaser an instrument of
assignment for effecting the grant, bargain, conveyance, sale,
assignment, transfer and delivery of the Purchased Assets, which
shall be in the form attached to this Agreement as Exhibit D
.
(c)
At the Closing, Purchaser shall
(i) deliver to Seller the Cash Purchase Price by wire transfer
of immediately available funds to a bank account designated by
Seller, which designation shall be made at least two business days
before the Closing, (ii) execute and deliver to Seller an
instrument of assumption for effecting the assumption of the
Assumed Liabilities, which shall be in the form attached to this
Agreement as Exhibit E , and (ii) execute and deliver to
Seller the Purchase Note.
5.
Closing Conditions
. (a) The obligations of
Purchaser under this Agreement to purchase the Purchased Assets at
the Closing are, at its option, subject to the satisfaction of the
following conditions:
(i)
The representations and warranties
of Seller set forth in this Agreement shall be true and correct in
all material respects both on the date of this Agreement and as of
the Closing Date with the same force and effect as if such
representations and warranties were made anew at and as of the
Closing Date.
(ii)
Seller shall have performed and
complied in all material respects with all agreements, obligations
and conditions set forth in this Agreement that are to be performed
by or complied with by Seller at or before the Closing.
(iii)
Seller shall have furnished to
Purchaser a certificate dated the Closing Date, signed by or on
behalf of Seller, to the effect that the conditions set forth in
clauses (i) and (ii) of this Section 5(a) have been
satisfied.
(b)
The obligations of Seller under this
Agreement to grant, bargain, convey, sell, assign, transfer and
deliver the Purchased Assets at the Closing are, at its option,
subject to the satisfaction of the following conditions:
(i)
The representations and warranties
of Purchaser set forth in this Agreement shall be true and correct
in all material respects both on the date of this Agreement and as
of the Closing Date with the same force and effect as if such
representations and warranties were made anew at and as of the
Closing Date.
(ii)
Purchaser shall have performed and
complied in all material respects with all agreements, obligations
and conditions set forth in this Agreement that are to be performed
by or complied with by Purchaser at or before the
Closing.
(iii)
Purchaser shall have furnished to
Seller a certificate dated the Closing Date, signed by Purchaser,
to the effect that the conditions set forth in clauses (i) and (ii)
of this Section 5(b) have been satisfied.
6.
Representation and Warranties of
Seller . Seller
hereby represents and warrants to Purchaser as follows:
(a)
This Agreement has been duly
authorized, executed and delivered
